The U.S. dollar fell after the release of disappointing non-farm payrolls. The previous week passed in light of news about a potential trade war between the U.S. and China, bringing much fear and uncertainty to the markets. Support is set at 1.22, resistance at 1.23.
The dollar index initially climbed to the highest level in one month on Friday, but the release of employment numbers happened to be quite a disappointment and pushed the currency lower. American economy has created the smallest number of jobs in six months in March. The reading came at 103k, while 185k was expected. It’s worth noting, that in March it was seen at 326k. The unemployment rate remained unchanged at 4.1%, while it was forecasted to fall to 4.0%.
Markets are still facing uncertainty and fears of a trade war which may endanger global growth. On Friday, China warned it is fully prepared to take retaliatory measures if the United States would go on with Donald Trump’s plan to impose additional $100 billion tariffs on Chinese goods.
The euro was unable to take advantage of the dollar’s weakness, as the currency is also facing some uncertainty. Data released last week showed the inflation isn’t rising as expected and the particular European Union economies are also slowing down. In effect this may bring a delay of ending the EBC’s quantative easing program and also delay of a potential normalization of the central banks monetary policy.
Pic.1. EUR/USD chart.
The EUR/USD pair is currently trading just below the resistance at 1.23. There will be no significant data releases in the U.S., so the European numbers may be the main driving factor for the pair today.